NAR survey: 1 in 4 real estate sales impacted by shutdown
CHICAGO – Jan. 9, 2019 – On Dec. 21, 2018, the President and Congress failed to an agreement regarding provisions of a Continuing Resolution to fund the federal government. That led to a partial federal government shutdown that affected aspects of federal housing, mortgage and programs that affect the real estate industry.
On Monday, the National Association of Realtors® (NAR) conducted a member survey to find out how the shutdown is impacting Realtors and real estate transactions, and a hefty 75 percent of members said they've seen no affect so far, though shutdown problems tend to get worse the longer the shutdown lasts. Eleven percent reported an impact on current clients and 11 percent on potential clients.
NAR survey findings of Realtors impacted by the shutdown
If respondents reported an impact on current or potential clients, they were asked further details. They were alsoallowed to pick more than one response since they may be working with more than one client.
- The most common impact, at 25 percent (6.25 percent of all respondents), was the buyer decided not to buy due to general economic uncertainty, even though they were not a federal government employee; 9 percent had clients who decided not to buy, as their clients are federal government employees.
- 6 percent had a seller who could not sell because their move was impacted by their employment.
- 3 percent had a buyer who was unable to buy due to lender rejection based on furlough (federal government employee or contractor).
- 3 percent had a buyer client who decided not to buy because of lost income or furlough (federal government contractor).
- 17 percent (4.25 percent of all respondents) had a delay because of a USDA loan, 13 percent (3.25 percent of all respondents) had a delay due to IRS income verification, 9 percent (2.25 percent of all respondents) had a delay due to FHA loans, 6 percent (1.5 percent of all respondents) had a delay due to a VA loan, and 9 percent (2.25 percent of all respondents) did not cite the reason for the delay.
- Other Realtors said they lost bids on homes due to the shutdown because: six percent said their buyer was using a FHA loan, four percent buyer a USDA loan, and 3 percent buyer a VA loan.
- Members also had contracts terminated due to the shutdown: 2 percent each because their buyer was using a VA loan or USDA loan, an 1 percent with a VA loan.
In past shutdowns, 59 percent of respondents active in real estate and were not impacted. However 13 percent had delayed transactions and three percent had lost transactions.
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